Brazilian firm taking stake in Equatorial Margin gas infrastructure

Brazilian oil and gas player Brava Energia has signed a binding partnership agreement with compatriot firm PetroReconcavo laying down the conditions for the latter’s acquisition of its natural gas outflow and processing infrastructure in the country’s Potiguar Basin, which is part of the Equatorial Margin.

Under the deal, PetroReconcavo will get a 50% interest in the infrastructure that includes two natural gas processing units with a total processing capacity of 3 million cubic meters (cbm) per day, liquefied petroleum gas (LPG) spheres situated within the Industrial Asset of Guamaré (IAG), as well as the gas pipeline connecting the two player’s producing fields to the IAG.

These assets form part of the Potiguar cluster – 22 concessions of onshore and shallow water fields Brava Energia’s predecessor 3R purchased from Petrobras in 2022.

Valued at $65 million, the transaction is set to be paid in two installments. The 35% of the total value will be paid upon the signing of the transaction definitive agreements with the remaining balance due upon closing after precedent conditions have been fulfilled. 

The deal also envisages setting up operational committees comprising members from both companies, with Brava acting as the consortium operator, and sharing IAG utilities and services that support the operation of the natural gas processing units. 

Furthermore, Brava will undertake to purchase natural gas from PetroReconcavo for five years starting in the second half of 2025. The contracted volumes are expected to average 150,000 cbm per day 

This builds on the memorandum of understanding (MoU) PetroReconcavo signed with 3R Petroleum Óleo e Gás, which subsequently merged with Enauta to form Brava Energia. The deal entailed negotiations relating to the sharing of natural gas infrastructure in the Potiguar Basin.

The duo expects the agreement to improve efficiency and optimize infrastructure utilization, reducing operating costs and increasing the reliability of the production and flow of natural gas and derivatives in the region.

Petrobras and Petroreconcavo are partners in the Tartaruga field, which is operated by a company controlled by PetroReconcavo. The energy giant recently issued a tender teaser to gauge interest from potential investors in the sale of its minority stake in the field.

Petrobras has been busy on several fronts over the past few weeks. Apart from handing out long-term drilling contracts to Ventura Offshore, Seadrill, and Constellation Oil Services, the state-owned energy giant is awaiting the arrival of FPSO Alexandre de Gusmão which recently departed China.